ERC okays sale of TransCo assets to VECO

MANILA, Philippines - The Energy Regulatory Commission (ERC) has approved the plan of state-run National Transmission Corp. (TransCo) to sell P125 million worth of sub-transmission assets to a Visayas-based power distributor.

The development will allow Visayan Electric Co. Inc. (VECO) to buy 10 sub-transmission assets valued at P125.78 million from Transco, ERC said in a decision dated March 12.

Specifically, Transco will unload its 100 megavolt-ampere, three-phase transformer; power circuit breakers; potential transformers; a type-4 69-kilovolt site development; and six switchbays for the protection of sub-transmission facilities. The assets are part of the TransCo-Quiot substation located in Pardo, Cebu City.

In 2010, TransCo and VECO filed a joint application for the transfer of the subtransmission assets that are within the franchise area of VECO. The contract was worth P141.49 million.

But the ERC said the selling price of the asset as agreed upon by the parties should be compared with that of the appraised value that will be determined by an independent appraiser.

Under the contract, VECO shall pay Transco in cash or manager’s check the total purchase price within 10 days from the receipt of the ERC decision.

“With the acquisition of the subject assets, VECO shall no longer be billed by TransCo with the corresponding connection and/or residual sub-transmission charges on the sub-transmission facilities equivalent to P382,182 per month,” ERC said.

However, TransCo would continue charging VECO with the corresponding connection and residual sub-transmission charges whose recovery has been deferred.

“Upon the consummation of the sale, let a copy of the corresponding deed of absolute sale between Transco and VECO be furnished the ERC for record purposes,” the energy industry regulator said.